When Funding the Family Comes First
 

Some family offices have very different constraints and priorities.

For Spencer Acker, partner and investment strategist at Imagine Holdings, a New York-based single-family office, growth is not the number one priority — supporting the family is.

He told me that his father had very clear views for how the money that had come from the sale of the generational family business should be spent. He wanted everyone in the family —  brothers, aunts and cousins alike — to get a fair share of the pie. This was non-negotiable.

But when Acker took over in 2022, he quickly realized that the portfolio had been positioned for growth in a way that did not account for these obligations. Money was going out every month to support the family, but most of the capital was tied up in illiquid investments.

“The top priority for us is to take care of the people closest to us,” he said. That has meant making some difficult decisions.

Acker was forced into imposing an austerity program on the family. In his words, the family needed to be deleveraged and execute a complete U-turn in how the portfolio was positioned. While the market was struggling and interest rates were rising during this time (2022-23), he was trying to make redemptions from hedge funds to pay down debt, something he said was so difficult it was life changing.

“I had to put my blinders on and grind my way through,” he said. “I'm now in investments that aren't sexy and don't make the headlines, and skipping the biggest, well-known funds. But that's on purpose.”

He told me this has meant avoiding early-stage venture capital, reducing private equity exposure and limiting illiquid investments. While the family still maintains a modest private market allocation, he prioritizes opportunities that preserve some degree of liquidity.

Before he took the reins the portfolio had been set up to maximize capital growth. At the same time the family maintained a huge philanthropic commitment and was making monthly distributions to family members. This created a clear cash flow mismatch.